EDAP TMS nine-month net loss widens to $28M
At September 30, cash stood at $56.3 million, while operating activities used $10.7 million over nine months.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
EDAP TMS S.A. reported third-quarter 2026 continuing revenue of $9.8 million, up 25.5% from $7.8 million a year earlier, and gross margin of 51.4% versus 46.6%. Continuing operating loss was $7.8 million versus $6.7 million, while consolidated net loss narrowed to $4.5 million from $5.9 million. For the first nine months, continuing revenue rose to $34.6 million from $23.8 million, but consolidated net loss widened to $28.0 million from $19.8 million.
The company is exiting its ESWL and Distribution segments to focus on robotic focal therapy; those businesses generated approximately 47% of consolidated revenue for the year ended December 31, 2025. EDAP expects disposal within one year of held-for-sale classification; no definitive agreement for either business had been executed. September 30 cash was $56.3 million; the August offering produced approximately $42.4 million net and EIB Tranche B borrowing produced $14.0 million net. Nine-month operating cash use was $10.7 million, and the company expects operating losses to continue.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointContinuing revenue rose 25.5% in Q3 and 45.2% over nine months.
Negative
- Moderate pointNine-month consolidated net loss widened to $28.0 million from $19.8 million.
Filing Explained
The August share issuance has diluted existing holders; EIB may still exercise outstanding warrants or seek a cash repurchase under its capped put.
The company completed its August underwritten offering by
Under the EIB agreement, EIB may require a cash repurchase of its warrants at fair market value, capped at
For the nine months ended
The company does not expect a purchaser to assume its indebtedness, and the EIB facility may require sale proceeds to prepay borrowings in certain circumstances; EDAP says it will assess this after definitive disposal agreements are executed.
Key Figures
Key Terms
treatment-driven revenue financial
gross margin financial
discontinued operations financial
held for sale financial
fair value less costs to sell financial
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What was FOCL's revenue in Q3 2026?
When does FOCL expect to dispose of its ESWL and Distribution businesses?
How much cash did FOCL have at September 30, 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
Table of Contents
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
| ||
|
FORM
|
|
(Mark One)
For the Quarterly Period Ended
OR
for the transition period from _________ to _________
Commission File Number:
EDAP TMS S.A.
(Exact name of registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
|
|
(Address of principal executive offices)(Zip Code) | |
+
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| | |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
one Ordinary Share (Ordinary Shares, nominal value €0.13 per share) |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ | Accelerated filer ☐ | |
Smaller reporting company | Emerging growth company |
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
As of November 5, 2026, the registrant had
Table of Contents
TABLE OF CONTENTS
| | |
Page | ||
PART I. FINANCIAL INFORMATION | 4 | |
| | |
Item 1. | Financial Statements (unaudited) | 4 |
| Condensed Consolidated Balance Sheets (unaudited) | 4 |
| Condensed Consolidated Statements of Operations (unaudited) | 5 |
| Condensed Consolidated Statements of Comprehensive Loss (unaudited) | 6 |
| Condensed Consolidated Statements of Shareholders’ Equity (unaudited) | 7 |
| Condensed Consolidated Statements of Cash Flows (unaudited) | 8 |
| Notes to Unaudited Condensed Consolidated Financial Statements | 9 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 26 |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 31 |
Item 4. | Controls and Procedures | 31 |
| | |
PART II. OTHER INFORMATION | 33 | |
| | |
Item 1. | Legal Proceedings | 33 |
Item 1A. | Risk Factors | 33 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 33 |
Item 3. | Defaults Upon Senior Securities | 33 |
Item 4. | Mine Safety Disclosures | 33 |
Item 5. | Other Information | 33 |
Item 6. | Exhibits | 34 |
| | |
SIGNATURES | 35 | |
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Table of Contents
Cautionary STATEMENT ON FORWARD-LOOKING INFORMATION
The statements contained in this Quarterly Report on Form 10-Q (this “Quarterly Report”) discuss our future expectations, contain projections of our results of operations or financial condition, and include other forward-looking statements which are made pursuant to the safe harbor provisions within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our actual results may differ materially from those expressed in forward-looking statements made or incorporated by reference into this Quarterly Report.
All statements other than present and historical facts and conditions, including forward-looking statements expressing our beliefs, plans, objectives, business strategy, or future events, performance or results of operations and financial position, are forward-looking statements, which involve estimates, assumptions, risks and uncertainties. Therefore, our actual results and performance may differ materially from those expressed in the forward-looking statements. Forward-looking statements often, although not always, include words or phrases such as the following: “believe,” “plan,” “intend,” “should,” “estimate,” “expect” and “anticipate” or their negative or similar expressions, which reflect our views about future events and financial performance. Forward-looking statements involve inherent risks and uncertainties, including matters not yet known to us or not currently considered material by us.
Actual events or results may differ materially from those expressed or implied in such forward-looking statements as a result of various factors. Factors that could affect future results or cause actual events or results to differ materially from those expressed or implied in forward-looking statements include, but are not limited to:
| ● | the success of our High Intensity Focused Ultrasound (“HIFU”) technology; |
| ● | the uncertainty of market acceptance for our HIFU devices; |
| ● | the market potential for our HIFU devices; |
| ● | the risks associated with the intended discontinuation of our Extracorporeal Shock Wave Lithotripsy (“ESWL”) and Distribution operating segments, including that the discontinuation may take longer or cost more than expected, may result in disputes with customers, distributors, employees or other counterparties, and may not produce the strategic benefits anticipated; |
| ● | the clinical and regulatory status of our devices in various geographical territories; |
| ● | the uncertainty in the regulatory agencies review and approval process for any of our devices and changes in their recommendations and guidance; |
| ● | risks associated with our financial position, indebtedness and our ability to raise capital; |
| ● | the impact of government regulation, particularly relating to public healthcare systems and the commercial distribution of medical devices; |
| ● | effects of intense competition in the markets in which we operate; |
| ● | the uncertainty of reimbursement status of procedures performed with our products and their level of reimbursement; |
| ● | dependence on our strategic suppliers and distribution partners; |
| ● | difficulties to attract and recruit high-level experts in software, design, and development of high technology devices such as our HIFU products; |
| ● | any event or other occurrence that would interrupt operations at our primary production facility; |
| ● | reliance on patents, licenses and key proprietary technologies; |
| ● | cybersecurity risks and incidents; |
2
Table of Contents
| ● | product liability risk; |
| ● | risk of exchange rate fluctuations, particularly between the euro and the U.S. dollar and between the euro and the Japanese yen; |
| ● | fluctuations in results of operations due to the cyclical nature of demand for medical devices; |
| ● | risks associated with the current worldwide inflationary environment, uncertain worldwide economic, political and financial environment, geopolitical instability, climate change impact, pandemics, and each of their related impacts on our business operations; |
| ● | risks relating to ownership of our securities; and |
| ● | risks relating to securities litigations involving class actions. |
You should also consider the information contained in the section titled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 and included in this Quarterly Report. Any forward-looking statement speaks only as of the date on which that statement is made. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by law. We qualify all of our forward-looking statements by these cautionary statements.
3
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
EDAP TMS S.A. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
As of September 30, 2026 and December 31, 2025
(in thousands of U.S. dollars except share and per share data)
(unaudited)
| | | | | | |
| | | | September 30, | | December 31, |
ASSETS | | Notes | | 2026 | | 2025 |
Current assets |
| |
| |
| |
Cash and cash equivalents |
| |
| |
| |
Current portion of trade accounts and notes receivable, net |
| 3 |
| |
| |
Other receivables |
| |
| |
| |
Inventories |
| 4 |
| |
| |
Other assets, current portion |
| |
| |
| |
Current assets of discontinued operations | | 18 | | | | |
Total current assets |
| |
| |
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Non-current assets |
| |
| |
| |
Property and equipment, net |
| |
| |
| |
Operating lease right-of-use assets |
| |
| |
| |
Intangible assets, net |
| 5 |
| |
| |
Goodwill |
| 5 |
| |
| |
Deposits and other non-current assets | | |
| |
| |
Deferred tax assets |
| |
| |
| |
Net trade accounts and notes receivable, non-current |
| 3 |
| |
| |
Non-current assets of discontinued operations | | 18 | | — | | |
Total assets | | |
| |
| |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | |
Current liabilities |
| | | | | |
Trade accounts and notes payable |
| |
| |
| |
Deferred revenues, current portion |
| |
| |
| |
Social security and other payroll withholdings taxes | | |
| |
| |
Employee absences compensation | | |
| |
| |
Other accrued liabilities |
| |
| |
| |
Short-term borrowings |
| |
| |
| |
Current obligations under finance leases |
| |
| |
| |
Current portion of operating lease obligations |
| |
| |
| |
Current portion of long-term debt |
| 6 |
| |
| |
Current liabilities of discontinued operations | | 18 | | | | |
Total current liabilities | | |
| |
| |
Non-current liabilities |
| |
| |
| |
Deferred revenues, non-current |
| |
| |
| |
Obligations under finance leases |
| |
| |
| |
Operating lease obligations, non-current |
| |
| |
| |
Long-term debt, non-current |
| 6 |
| |
| |
Other long-term liabilities |
| |
| |
| |
Non-current liabilities of discontinued operations | | 18 | | — | | |
Total liabilities | | |
| |
| |
Shareholders’ equity | | | | | | |
Common stock at € | | | | | | |
Additional paid-in capital | | | | | | |
Accumulated deficit | | | | ( | | ( |
Cumulative other comprehensive loss | | | | ( | | ( |
Treasury stock, at cost | | | | ( | | ( |
Total shareholders’ equity | | | | | | |
Total liabilities and shareholders’ equity | | | | | | |
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
Table of Contents
EDAP TMS S.A. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the three months and nine months ended September 30, 2026, and 2025
(in thousands of U.S. dollars except share and per share data)
(unaudited)
| | | | | | | | | | | |
| | | | Three Months Ended September 30, | | | Nine Months Ended September 30, | ||||
| | Note | | 2026 | | 2025 | |
| 2026 | | 2025 |
Sales of goods | | |
| |
| |
| | |
| |
Sales of RPPs & leases | | |
| |
| |
| | |
| |
Sales of spare parts and services | | |
| |
| |
| | |
| |
Total revenues | | 9 |
| |
| |
| | |
| |
| | | | | | | | | | | |
Cost of goods sold | | |
| ( |
| ( |
| | ( |
| ( |
Cost of RPPs & leases | | |
| ( |
| ( |
| | ( |
| ( |
Cost of spare parts and services | | |
| ( |
| ( |
| | ( |
| ( |
Total cost of sales |
| |
| ( |
| ( |
| | ( |
| ( |
| | | | | | | | | | | |
Gross profit | | |
| |
| |
| | |
| |
| | | | | | | | | | | |
Research and development expenses |
| |
| ( |
| ( |
| | ( |
| ( |
Selling and marketing expenses | | |
| ( |
| ( |
| | ( |
| ( |
General and administrative expenses | | |
| ( |
| ( |
| | ( |
| ( |
| | | | | | | | | | | |
Operating loss from continuing operations | | |
| ( |
| ( |
| | ( |
| ( |
Financial (expense) income, net |
| |
| |
| ( |
| | ( |
| ( |
Foreign currency exchange gain (loss), net | | |
| |
| |
| | |
| ( |
| | | | | | | | | | | |
Loss from continuing operations before taxes | | | | ( | | ( | | | ( |
| ( |
Income tax expense | | 11 | | ( | | ( | | | ( | | ( |
Loss from continuing operations |
| |
| ( |
| ( |
| | ( | | ( |
Income (loss) from discontinued operations, net of tax | | 18 | | | | | | | | | |
Net loss | | | | ( | | ( | | | ( | | ( |
Loss per share from continuing operations - Basic and Diluted |
| 12 |
| ( |
| ( |
| | ( |
| ( |
Earnings per share from discontinued operations - basic and diluted (Per-share amounts are rounded) | | 12 | | | | | | | | | |
Loss per share - Basic and Diluted | | 12 | | ( | | ( | | | ( | | ( |
Average number of shares used in computation of basic and diluted net loss per share |
| 12 |
| |
| |
| | |
| |
The accompanying notes are an integral part of the condensed consolidated financial statements.
5
Table of Contents
EDAP TMS S.A. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
For the three and nine months ended September 30, 2026, and 2025
(in thousands of U.S. dollars)
(unaudited)
| | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, | ||||
| | 2026 | | 2025 | | 2026 | | 2025 |
Net loss | | ( | | ( |
| ( |
| ( |
Foreign currency translation adjustments |
| ( | | ( |
| ( | | ( |
Comprehensive loss, net of tax | | ( | | ( |
| ( |
| ( |
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
Table of Contents
EDAP TMS S.A. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
For the three and nine months ended September 30, 2026, and 2025
(in thousands of U.S. dollars except for share amounts)
(unaudited)
| | | | | | | | | | | | | | |
| | | | | | Additional | | Accumulated | | Cumulative | | | | |
| | Number | | Common | | paid-in | | deficit | | other comprehensive | | Treasury | | |
| | of shares | | stock | | capital | | | | (loss) | | stock | | Total |
Balance as of December 31, 2024 | | | | | | | | ( | | ( | | ( |
| |
Net loss | | — | | — | | — | | ( | | — | | — |
| ( |
Translation adjustment |
| — | | — | | — | | — | | ( | | — |
| ( |
Stock-based compensation |
| — | | — | | | | — | | — | | — |
| |
Capital increase |
| | | | | ( | | — | | — | | — |
| - |
Balance as of September 30, 2025 |
| |
| |
| |
| ( |
| ( |
| ( |
| |
| | | | | | | | | | | | | | |
Balance as of December 31, 2025 | | | | | | | | ( | | ( | | ( |
| |
Net loss |
| — | | — | | — | | ( | | — | | — |
| ( |
Translation adjustment |
| — | | — | | — | | — | | ( | | — |
| ( |
Stock-based compensation |
| — | | — | | | | — | | — | | — |
| |
Option exercises | | | | | | — | | — | | — | | — | | |
Capital increase |
| | | | | | | — | | — | | — |
| |
Balance as of September 30, 2026 |
| |
| |
| |
| ( |
| ( |
| ( |
| |
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| | | | | | Additional | | Accumulated | | Cumulative | | | | |
| | Number | | Common | | paid-in | | deficit | | other comprehensive | | Treasury | | |
| | of shares | | stock | | capital | | | | (loss) | | stock | | Total |
Balance as of June 30, 2025 | | | | | | | | ( | | ( | | ( |
| |
Net loss | | — | | — | | — | | ( | | — | | — |
| ( |
Translation adjustment |
| — | | — | | — | | — | | ( | | — |
| ( |
Stock-based compensation |
| — | | — | | | | — | | — | | — |
| |
Capital increase |
| | | — | | — | | — | | — | | — |
| — |
Balance as of September 30, 2025 |
| |
| |
| |
| ( |
| ( |
| ( |
| |
| | | | | | | | | | | | | | |
Balance as of June 30, 2026 | | | | | | | | ( | | ( | | ( |
| ( |
Net loss |
| — | | — | | — | | ( | | — | | — |
| ( |
Translation adjustment |
| — | | — | | — | | — | | ( | | — |
| ( |
Stock-based compensation |
| — | | — | | | | — | | — | | — |
| |
Option exercises | | | | | | — | | — | | — | | — | | |
Capital increase |
| | | | | | | — | | — | | — |
| |
Balance as of September 30, 2026 |
| |
| |
| |
| ( |
| ( |
| ( |
| |
The accompanying notes are an integral part of these condensed consolidated financial statements.
7
Table of Contents
EDAP TMS S.A. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
For the nine months ended September 30, 2026, and 2025
(in thousands of U.S. dollars)
(unaudited)
| | | | |
| | September 30, | | September 30, |
| | 2026 | | 2025 |
Cash flows from operating activities |
| |
| |
Net loss |
| ( |
| ( |
Adjustments to reconcile net income (loss) to net cash generated by (used in) operating activities: |
| |
| |
Depreciation and amortization |
| |
| |
Share based compensation |
| |
| |
Change in allowances for doubtful accounts & slow-moving inventories |
| |
| |
Change in fair value on EIB Warrants and loan amortization | | | | — |
Change in long-term provisions |
| |
| |
Net capital loss on disposals of assets |
| |
| |
Deferred tax expense (benefit) |
| |
| |
Operating cash flow before changes in working capital |
| ( |
| ( |
Increase/Decrease in operating assets and liabilities: |
| |
| |
Decrease (Increase) in trade accounts and notes and other receivables |
| |
| |
Decrease (Increase) in inventories |
| ( |
| |
Decrease (Increase) in other assets |
| ( |
| |
(Decrease) Increase in trade accounts and notes payable |
| |
| ( |
(Decrease) Increase in accrued expenses, other current liabilities |
| |
| ( |
Net change in operating assets and liabilities |
| |
| |
Net cash generated by (used in) operating activities |
| ( |
| ( |
Cash flows from investing activities: |
| |
| |
Additions to capitalized assets produced by the Company |
| ( |
| ( |
Proceeds from sale of leased back assets |
| |
| — |
Acquisitions of property and equipment |
| ( |
| ( |
Acquisitions of intangible assets |
| ( |
| ( |
Decrease (Increase) in deposits and guarantees |
| ( |
| ( |
Net cash generated by (used in) investing activities |
| ( |
| ( |
Cash flow from financing activities: |
| |
| |
Proceeds from capital increase, net of issuance costs |
| |
| — |
Proceeds from long term borrowings, net of financing costs |
| |
| |
Repayment of long term borrowings |
| ( |
| ( |
Repayment of obligations under financing leases |
| ( |
| ( |
Increase (decrease) in bank overdrafts and short-term borrowings |
| ( |
| ( |
Net cash generated by (used in) financing activities |
| |
| ( |
Net effect of exchange rate changes on cash and cash equivalents |
| ( |
| |
Net increase (decrease) in cash and cash equivalents |
| |
| ( |
Cash and cash equivalents at beginning of year |
| |
| |
Cash and cash equivalents at end of period |
| |
| |
The accompanying notes are an integral part of these condensed consolidated financial statements.
8
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 1. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
The accompanying unaudited condensed consolidated financial statements of EDAP TMS S.A. and its subsidiaries (collectively, the “Company,” “we,” “us” or “our”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) for interim financial information, including Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.
Effective January 1, 2026, the Company no longer qualified as a “Foreign Private Issuer” as defined in Rule 3b-4 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and became a U.S. domestic issuer. The Company also qualifies as a “smaller reporting company” as defined under the rules of the SEC.
These unaudited condensed consolidated financial statements have been prepared on the same basis as, and should be read in conjunction with, the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on March 25, 2026 (the “2025 Annual Report”). In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation of the financial position, results of operations, and cash flows for the interim periods presented have been included. Operating results for the nine months ended September 30, 2026 are not necessarily indicative of the results that may be expected for the full fiscal year ending December 31, 2026.
Discontinued Operations
On May 28, 2026, the Company’s Board of Directors approved a plan to exit the Company’s ESWL and Distribution reportable segments in order to concentrate the Company’s resources on its robotic focal therapy business built around the Focal One® HIFU platform. The Company publicly announced the planned exit on May 29, 2026. During the second quarter of 2026, the ESWL and Distribution segments met the criteria to be classified as held for sale under ASC 205-20, Presentation of Financial Statements — Discontinued Operations, and ASC 360-10, Property, Plant, and Equipment, and the Company determined that the planned exit represents a strategic shift that will have a major effect on the Company’s operations and financial results. Accordingly, the results of the ESWL and Distribution segments are reported as discontinued operations in the condensed consolidated statements of operations for all periods presented, and the related assets and liabilities are presented separately as assets and liabilities of discontinued operations in the condensed consolidated balance sheets as of September 30, 2026 and December 31, 2025. The condensed consolidated statements of cash flows have not been adjusted to separately disclose cash flows related to discontinued operations. The Company has reclassified certain prior year amounts to conform to the current year’s presentation for discontinued operations. Unless otherwise noted, amounts and disclosures in these notes relate to the Company’s continuing operations. The disposal groups were measured at the lower of their carrying amount and fair value less costs to sell.
9
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Significant Accounting Policies
Except as described below with respect to discontinued operations, there have been no changes in the Company’s significant accounting policies as disclosed in Note 1 to the audited consolidated financial statements included in the 2025 Annual Report.
Discontinued Operations and Assets Held for Sale
The Company classifies a component or group of components as held for sale in the period in which all of the criteria in ASC 205-20-45-1E are met, including management’s commitment to a plan of sale, availability for immediate sale in present condition, an active program to locate a buyer, probability of sale within one year, active marketing at a price reasonable in relation to fair value, and a low likelihood of significant changes to, or withdrawal of, the plan. A disposal is reported as a discontinued operation when it represents a strategic shift that has, or will have, a major effect on the Company’s operations and financial results. Disposal groups classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell, and depreciation and amortization of long-lived assets ceases upon classification. The results of discontinued operations are presented separately, net of tax, for all periods presented, and the related assets and liabilities are presented separately for all balance sheet periods presented.
Recently Adopted Accounting Pronouncements
In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances transparency by requiring additional disclosures related to income taxes. The amendments primarily require:
The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted.
There have been no recently issued accounting standards that are expected to have a material impact on our results of operations, financial condition, or cash flows.
Accounting Pronouncements Not Yet Adopted
The FASB has not issued any accounting standards updates during the nine months ended September 30, 2026. For information on accounting pronouncements issued in prior years but not yet adopted, refer to Note 1-25 to the audited consolidated financial statements included in the Company’s 2025 Annual Report.
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption.
10
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 3. TRADE ACCOUNTS AND NOTES RECEIVABLE, NET
Trade accounts and notes receivable for HIFU consisted of the following as of:
| | | | |
| | September 30, | | December 31, |
| | 2026 | | 2025 |
Trade accounts receivable |
| | | |
Less: allowance for doubtful accounts |
| ( | | ( |
Total |
| | | |
Less current portion |
| ( | | ( |
Total long-term portion |
| | | |
Notes receivable generally represent commercial bills of exchange with initial maturities of 90 days or less.
Bad debt expenses amount to a net cost of $
NOTE 4. INVENTORIES
HIFU Inventories consisted of the following as of:
| | | | |
| | September 30, | | December 31, |
| | 2026 | | 2025 |
Components, spare parts | | |
| |
Work-in-progress | | |
| |
Finished goods – own manufactured products | | |
| |
Total gross inventories | | |
| |
Less: allowance for slow-moving inventory and net realizable value | | ( |
| ( |
Total | | |
| |
The provision for slow moving inventory relates to components and spare parts. The decrease in the allowance for slow moving inventory is mainly due to exchange rate impact and write off.
11
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 5. GOODWILL AND INTANGIBLE ASSETS
As discussed in Note 1-13 of the 2025 Annual Report, ASC 350 requires that goodwill not be amortized but instead be tested at least annually for impairment, or more frequently when events or change in circumstances indicate that the asset might be impaired, by comparing the carrying value to the fair value of the reporting unit to which they are assigned. Goodwill amounted to $
The Company completed the required annual impairment test in the fourth quarter of 2025. To determine the fair value of the Company’s reporting units, the Company used the discounted cash flow approach. The fair value of the reporting unit was in excess of the reporting unit’s book value, which resulted in
Intangible assets consisted of the following as of:
| | | | |
| | September 30, | | December 31, |
| | 2026 | | 2025 |
Licenses |
| |
| |
Patents |
| |
| |
Organization costs |
| |
| |
Total gross value |
| |
| |
Accumulated amortization for licenses |
| ( |
| ( |
Accumulated amortization for patents |
| ( |
| ( |
Accumulated amortization for organization costs |
| ( |
| ( |
Less: Total accumulated amortization |
| ( |
| ( |
Total |
| |
| |
Amortization expenses related to intangible assets amounted to $
NOTE 6. LONG TERM DEBT
The Company has the following outstanding debt as of September 30, 2026 and December 31, 2025:
EIB Credit Facility and Warrants
On October 17, 2025, EDAP entered into the Finance Contract with EIB for up to €
The Tranche A and B borrowings and the Tranche A and B Warrants are each defined as freestanding financial instruments in accordance with ASC 480-10-20. At inception, the proceeds are allocated between i) the Warrants at their initial fair value and (ii) a debt component for the residual amount. Subsequently, the Warrants are remeasured at fair value with changes in fair value reflected in earnings and the debt component is accounted for at amortized cost.
12
The Warrant Agreement includes a put option: EIB may request the Company to buy back the Warrants in cash for their fair market value as determined in accordance with the valuation principles set out in the Warrant Agreement. The amount is capped at $
Puttable warrants that permit the counterparty to require the issuer to pay cash to settle the warrant or to purchase the shares obtained upon exercise of the warrants, freestanding warrants and other similar instruments on shares that are redeemable require liability classification under ASC 480.
EIB – Tranche A Warrants
On October 17, 2025, the Company issued
The Tranche A Warrants were classified as a liability at inception (on October 17, 2025) and then changes in fair value are recognized in earnings in subsequent periods. The fair value of the Tranche A Warrants amounted to $
The following table presents fair value as of:
| | | |
EIB Credit Facility Tranche A Warrants | September 30, 2026 | | December 31, 2025 |
Number of Warrants outstanding | | | |
Share price | | | |
Volatility | | ||
Maturity (years) | | ||
Fair value | | | |
EIB Credit Facility – Tranche A – Financial debt at amortized cost
Tranche A borrowings of $
The carrying value of the EIB Tranche A borrowings and Tranche A Warrants was as follows as of September 30, 2026 and December 31, 2025:
| | | |
EIB Tranche A | September 30, 2026 | | December 31, 2025 |
Debt component - amortized cost | | | |
Warrants | | | |
Total | | | |
EIB – Tranche B Warrants
On April 1, 2026, the Company issued
The Tranche B Warrants were classified as a liability at inception (on April 1, 2026) and their changes in fair value are recognized in earnings in subsequent periods. The fair value of the Tranche B Warrants amounted to $
The following table presents fair value as of:
| | | | |
EIB Credit Facility Tranche B Warrants | September 30, 2026 | | At inception | |
Number of Warrants outstanding | | | | |
Share price | | | | |
Volatility | | | ||
Maturity (years) | | | ||
Fair value | | | | |
13
EIB Credit Facility – Tranche B – Financial debt at amortized cost
Tranche B borrowings of $
The carrying value of the EIB Tranche B borrowings and Tranche B Warrants was as follows as of September 30, 2026:
| | | |
EIB Tranche B | September 30, 2026 | | At inception |
Debt component – amortized cost | | ||
Expenses | — | | ( |
Debt component - net value | | ||
Warrants | | | |
Total net value | |
Other Loans
The following summarizes other loan facilities as of:
| | | | |
| | September 30, | | December 31, |
|
| 2026 | | 2025 |
France term loan |
| |
| |
Including EIB loan | | | | |
Including EIB warrants | | | | |
Including other French loans | | | | |
Total long term debt |
| |
| |
Less current portion |
| ( |
| ( |
Total long-term portion |
| |
| |
NOTE 7. PENSION AND OTHER BENEFIT PLANS
The Company does not have a funded benefit plan. The following is a reconciliation of pension cost components for the nine months ended:
| | | | |
| | September 30, | ||
| | 2026 | | 2025 |
Change in benefit obligations: |
| |
| |
Projected benefit obligations at beginning of year |
| |
| |
Service cost |
| |
| |
Interest cost |
| |
| — |
Exchange rate impact |
| ( |
| |
Projected benefit obligations at end of the period |
| |
| |
Unrecognized actuarial (gain) loss |
| ( |
| ( |
Unrecognized prior service cost |
| |
| |
14
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 8. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
The components of accumulated other comprehensive income (loss) net of tax were as follows:
| | | | | | |
| | Nine Months Ended September 30, 2026 | ||||
| | Foreign currency | | Provision for | | |
| | translation | | retirement indemnities | | |
| | adjustment | | (net of tax) | | Total |
Beginning balance | | ( | | | | ( |
Net current-period other comprehensive income (loss) |
| ( |
| — |
| ( |
Ending balance |
| ( |
| |
| ( |
| | | | | | |
| | Nine Months Ended September 30, 2025 | ||||
| | Foreign currency | | Provision for | | |
| | translation | | retirement indemnities | | |
| | adjustment | | (net of tax) | | Total |
Beginning balance | | ( | | | | ( |
Net current-period other comprehensive income (loss) |
| ( | | — | | ( |
Ending balance |
| ( | | |
| ( |
NOTE 9. TOTAL SALES
The amount of total sales derived from our continuing operations in Asia, France, the United States and other geographical areas, were as follows:
| | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, | ||||
Primary geographical markets | | 2026 | | 2025 |
| 2026 | | 2025 |
Asia |
| |
| | | |
| |
France |
| |
| | | |
| |
United States |
| |
| | | |
| |
Others geographical areas |
| |
| | | |
| |
Total Sales |
| |
| | | |
| |
The amount of sales is recognized on the following timing:
| | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, | ||||
Timing of revenue recognition | | 2026 | | 2025 |
| 2026 | | 2025 |
Products transferred at a point in time |
| | | | | | | |
Products and services transferred over time |
| | | | | | | |
Total Sales |
| |
| | | |
| |
15
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars
(unaudited)
NOTE 10. SHAREHOLDERS’ EQUITY
During the three months ended September 30, 2026, the Company granted
On September 15, 2026, pursuant to the June 26, 2026 Shareholders resolution, the Board of Directors approved a new 2026 RSU plan and approved the filing of the corresponding Form S-8 to register the shares underlying the free shares issuable pursuant to such plan.
Underwritten Public Offering
On August 11, 2026, the Company priced an underwritten public offering of
The Company received total gross proceeds of approximately $
The Company intends to use the net proceeds as described under “Use of Proceeds” in the prospectus supplement date August 11, 2026.
NOTE 11. INCOME TAXES
For interim periods, the Company’s income tax expense or benefit is computed based on its estimated annual effective tax rate and any discrete items that impact the interim periods. For the nine months ended September 30, 2026 and 2025, the Company recorded a tax expense of $
The Company has tax carryforwards in the United States and in certain states and foreign jurisdictions. We have deferred tax assets related to net operating loss and other tax carryforwards in the U.S. and in certain states and foreign jurisdictions. We recognize a valuation allowance to reduce our deferred tax assets to the amount that is more likely than not to be realized.
16
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited
NOTE 12. LOSS PER SHARE
| | | | | | | | | | | |
| | | | | | | | | | | |
Earnings (loss) per share from continuing operations | | | Three Months Ended September 30, | | Nine Months Ended September 30, | ||||||
| | | 2026 | | 2025 | | 2026 | | | 2025 | |
Loss available to common shareholders (in U.S. dollars) | | | ( | | | ( | | ( | | | ( |
Weighted average number of shares for the computation of LPS | | | | | | | | | | | |
Basic LPS (in U.S. dollars) | | | ( | | | ( | | ( | | | ( |
Weighted average number of shares for the computation of diluted LPS | | | | | | | | | | | |
Diluted LPS (in U.S. dollars) | | | ( | | | ( | | ( | | | ( |
| | | | | | | | | | | |
Earnings (loss) per share from discontinued operations | | | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
| | | 2026 | | 2025 | | 2026 | | | 2025 | |
Loss or gain available to common shareholders (in U.S. dollars) | | | | | | | | | | | |
Weighted average number of shares for the computation of LPS | | | | | | | | | | | |
Basic LPS (in U.S. dollars) | | | | | | | | | | | |
Weighted average number of shares for the computation of diluted LPS | | | | | | | | | | | |
Diluted LPS (in U.S. dollars) | | | | | | | | | | | |
| | | | | | | | | | | |
Loss per share | | | Three Months Ended September 30, | | Nine Months Ended September 30, | ||||||
| | | 2026 | | | 2025 | | 2026 | | | 2025 |
Loss available to common shareholders (in U.S. dollars) | | | ( | | | ( | | ( | | | ( |
Weighted average number of shares for the computation of LPS | | | |
| | | | |
| | |
Basic LPS (in U.S. dollars) | | | ( | | | ( | | ( | | | ( |
Weighted average number of shares for the computation of diluted LPS | |
| | |
| |
| | |
| |
Diluted LPS (in U.S. dollars) | | | ( | | | ( | | ( | | | ( |
The effects of dilutive securities, for the three and nine months ended September 30, 2026, and 2025 were excluded from the calculation of diluted LPS as a net loss was reported in these periods.
17
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 13. COMMITMENTS AND CONTINGENCIES
Commitments
The Company currently has commitments regarding its operating leases as described in Note 13-2 to the audited consolidated financial statements included in the Company’s 2025 Annual Report.
Contingencies
The Company currently has contingencies relating to standard warranties provided to customers for products as described in Note 1-15 and Note 12 to the audited consolidated financial statements included in the Company’s 2025 Annual Report.
NOTE 14. FAIR VALUE OF FINANCIAL INSTRUMENTS
The following disclosure of the estimated fair value of financial instruments was made in accordance with the requirements of ASC 820 “Disclosure about fair value of financial instruments” and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value.
ASC 820 defines three levels of inputs that may be used to measure fair value and requires that the assets or liabilities carried at fair value be disclosed by the input level under which they were valued. The input levels are defined as follows:
Level 1: Quoted (unadjusted) prices in active markets for identical assets and liabilities that the reporting entity can access at the measurement date.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
The recorded amount of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities and short-term borrowings are a reasonable estimate of their fair value due to the short-term maturities of these instruments. As of September 30, 2026 and December 31, 2025, the Company did not have any other asset or liability measured at fair value, other than the Tranche A and Tranche B Warrants issued in connection with the Credit Facility (see note 6).
As of September 30, 2026 and December 31, 2025, the fair value of the Company’s long-term debt was not materially different from the carrying value.
18
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 15. CONCENTRATION OF CREDIT RISK
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash and cash equivalents and trade accounts and notes receivable from customers, primarily located in France, Japan and the United States. The Company maintains cash deposits with major banks. Management periodically assesses the financial condition of these institutions and believes that credit risk is limited.
The Company has implemented procedures to monitor the creditworthiness of its customers. The Company obtains bank guarantees for first time or infrequent unknown customers, and in certain cases obtains insurance against the risk of a payment default by the customer. The Company reviewed individual customer balances considering current and historical loss experience and general economic conditions in determining the allowance for doubtful accounts receivable of $
Actual losses may vary from the current estimates, and any adjustments are reported in earnings in the periods in which they become known.
For the three months and nine months ended September 30, 2026 and for the year ended December 31, 2025, the Company did not generate more than 10% of its revenue from a single customer.
NOTE 16. FOREIGN CURRENCY TRANSACTIONS
The Company generates a significant percentage of its revenues, and of its operating expenses, in currencies other than the US$. The Company’s operating profitability could be materially adversely affected by large fluctuations in the rate of exchange between the US$ and such other currencies. The Company may engage in foreign exchange hedging activities when deemed necessary, but there can be no assurance that hedging activities will be offset by the impact of movements in exchange rates on the Company’s results of operations. As of September 30, 2026, there were no outstanding hedging instruments.
19
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
NOTE 17. DIVISION INFORMATION (SEGMENT REPORTING)
Historically, the Company’s activities were organized into
| | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, | ||||
| | 2026 | | 2025 |
| 2026 | | 2025 |
Operating loss |
| ( |
| ( | | ( |
| ( |
Financial (expense) income, net |
| |
| ( | | ( |
| ( |
Foreign currency exchange (losses) gains, net |
| |
| | | |
| ( |
Income tax (expense) benefit |
| ( |
| ( | | ( |
| ( |
Consolidated net loss |
| ( |
| ( | | ( |
| ( |
A summary of the Company’s operations by segment is presented below for the three and nine months ended September 30, 2026, and 2025:
| | | | | | |
| | | | | | |
Three Months Ended | | HIFU | | Reconciling | | Total |
September 30, 2026 | | Division | | Items | | continuing |
Sales of goods |
| | | — |
| |
Sales of RPPs & leases |
| | | — |
| |
Sales of spare parts and services |
| | | — |
| |
Total sales |
| | | — |
| |
Total cost of sales |
| ( | | — |
| ( |
Gross profit |
| | | — |
| |
R&D expenses |
| ( | | — |
| ( |
Selling and marketing expenses |
| ( | | — |
| ( |
General and administrative expenses |
| ( |
| ( |
| ( |
Total expenses |
| ( |
| ( |
| ( |
Operating income (loss) from operations |
| ( |
| ( |
| ( |
Total Assets |
| | | |
| |
Net cash generated by (used in) investing activities |
| ( | | — |
| ( |
Non-current assets |
| | | — |
| |
Goodwill |
| | | — |
| |
20
| | | | | | |
| | | | | | |
Three Months Ended | | HIFU | | Reconciling | | Total |
September 30, 2025 | | Division | | Items | | continuing |
Sales of goods |
| |
| — |
| |
Sales of RPPs & leases |
| |
| — |
| |
Sales of spare parts and services |
| |
| — |
| |
Total sales |
| |
| — |
| |
Total cost of sales |
| ( |
| — |
| ( |
Gross profit |
| |
| — |
| |
R&D expenses |
| ( |
| — |
| ( |
Selling and marketing expenses |
| ( |
| — |
| ( |
General and administrative expenses |
| ( |
| ( |
| ( |
Total expenses |
| ( |
| ( |
| ( |
Operating income (loss) from operations |
| ( |
| ( |
| ( |
Total Assets |
| | | |
| |
Net cash generated by (used in) investing activities |
| ( | | — |
| ( |
Non-current assets |
| | | — |
| |
Goodwill |
| | | — |
| |
| | | | | | |
| | | | | | |
Nine months ended | | HIFU | | Reconciling | | Total |
September 30, 2026 | | Division | | Items | | continuing |
Sales of goods |
| | | — |
| |
Sales of RPPs & leases |
| | | — |
| |
Sales of spare parts and services |
| | | — |
| |
Total sales |
| | | — |
| |
Total cost of sales |
| ( | | — |
| ( |
Gross profit |
| | | — |
| |
R&D expenses |
| ( | | — |
| ( |
Selling and marketing expenses |
| ( | | — |
| ( |
General and administrative expenses |
| ( |
| ( |
| ( |
Total expenses |
| ( |
| ( |
| ( |
Operating income (loss) from operations |
| ( |
| ( |
| ( |
Total Assets |
| | | |
| |
Net cash generated by (used in) investing activities |
| ( | | — |
| ( |
Non-current assets |
| | | — |
| |
Goodwill |
| | | — |
| |
| | | | | | |
| | | | | | |
21
Nine months ended | | HIFU | | Reconciling | | Total |
September 30, 2025 | | Division | | Items | | continuing |
Sales of goods |
| |
| — |
| |
Sales of RPPs & leases |
| |
| — |
| |
Sales of spare parts and services |
| |
| — |
| |
Total sales |
| |
| — |
| |
Total COS |
| ( |
| — |
| ( |
Gross profit |
| |
| — |
| |
R&D expenses |
| ( |
| — |
| ( |
Selling and marketing expenses |
| ( |
| — |
| ( |
G&A expenses |
| ( |
| ( |
| ( |
Total expenses |
| ( |
| ( |
| ( |
Operating income (loss) from operations |
| ( |
| ( |
| ( |
Total Assets |
| | | |
| |
Net cash generated by (used in) investing activities |
| ( | | — |
| ( |
Non-current assets |
| | | — |
| |
Goodwill |
| | | — |
| |
N
NOTE 18. DISCONTINUED OPERATIONS
Background and Plan of Disposal
On May 28, 2026, the Board of Directors approved a plan to discontinue and exit the Company’s ESWL and Distribution reportable segments and delegated authority to management to develop and implement the related disposal plans. The exit implements the Company’s strategic realignment, announced on May 29, 2026 together with the Company’s new FocalTherics corporate identity, to focus the Company exclusively on its robotic focal therapy business built around the Focal One® HIFU platform.
The ESWL segment consists of the Company’s extracorporeal shock wave lithotripsy activities, including systems, mobile treatment activities, service arrangements, spare parts and consumable electrodes, and related personnel and intellectual property. The Distribution segment distributes third-party medical devices, including lasers, imaging, and urodynamics products and related consumables and spare parts, through the Company’s subsidiaries in Japan, South Korea, Malaysia and Germany.
Expected Manner and Timing of Disposal
The Company expects to dispose of the ESWL and Distribution businesses through one or more sale or transfer transactions or, for certain operations, an orderly wind-down which may be structured on a portfolio, regional or counterparty-specific basis. The Company has initiated an active program to locate buyers, including outreach to multiple potential counterparties, execution of confidentiality agreements, and receipt and negotiation of transaction proposals, and expects the disposals to be completed within one year of the held-for-sale classification date. No definitive agreement for the sale of either business had been executed as of the date of this Quarterly Report on Form 10-Q (this “Quarterly Report”).
Held-for-Sale Classification
At the end of the second quarter of 2026, the ESWL and Distribution segments met the held-for-sale criteria in ASC 205-20-45-1E. Because the planned exit involves
22
Results of Discontinued Operations
The results of the ESWL and Distribution segments reported as discontinued operations, net of tax, and the major classes of line items constituting the pretax income (loss) of discontinued operations, were as follows for the three and nine months ended September 30, 2026 and 2025:
| | | | | | | | | | | |
| | | | Three Months Ended September 30, | | | Nine Months Ended September 30, | ||||
| | Note | | 2026 | | 2025 | |
| 2026 | | 2025 |
Sales of goods | | |
| |
| |
| | |
| |
Sales of RPPs & leases | | |
| |
| |
| | |
| |
Sales of spare parts and services | | |
| |
| |
| | |
| |
Total sales |
| |
| |
| |
| | |
| |
| | | | | | | | | | | |
Cost of goods sold | | |
| ( |
| ( |
| | ( |
| ( |
Cost of RPPs & leases | | |
| ( |
| ( |
| | ( |
| ( |
Cost of spare parts and services | | |
| ( |
| ( |
| | ( |
| ( |
Total cost of sales |
| |
| ( |
| ( |
| | ( |
| ( |
| | | | | | | | | | | |
Gross profit | | |
| |
| |
| | |
| |
| | | | | | | | | | | |
Research and development expenses |
| |
| ( |
| ( |
| | ( |
| ( |
Selling and marketing expenses | | |
| ( |
| ( |
| | ( |
| ( |
General and administrative expenses | | |
| ( |
| ( |
| | ( |
| ( |
| | | | | | | | | | | |
Operating income (loss) | | |
| |
| |
| | |
| |
Financial (expense) income, net |
| |
| ( |
| |
| | ( |
| |
Foreign currency exchange gain (loss), net | | |
| |
| ( |
| | |
| ( |
| | | | | | | | | | | |
Income (loss) before taxes |
| |
| |
| |
| | | | |
Income tax expense |
| |
| ( |
| ( |
| | ( |
| ( |
Income (loss) | | |
| |
| |
| | |
| |
Income (loss) per share - Basic and Diluted |
| 12 |
| |
| |
| | |
| |
Average number of shares used in computation of basic & diluted loss per share |
| 12 |
| |
| |
| | |
| |
23
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
Assets and Liabilities of Discontinued Operations
The carrying amounts of the major classes of assets and liabilities of the ESWL and Distribution segments classified as discontinued operations in the condensed consolidated balance sheets were as presented below as of September 30, 2026 and December 31, 2025. As we expect the sale of discontinued operations to be completed within one year from June 30, 2026, all the non-current assets or liabilities as of September 30, 2026 have been reclassified as current assets or liabilities in the Condensed Consolidated Balance Sheet.
| | | | | | |
| | | | September 30, | | December 31, |
ASSETS | | Notes | | 2026 | | 2025 |
Cash and cash equivalents |
| |
| — |
| — |
Current portion of trade accounts and notes receivable, net |
| |
| |
| |
Other receivables |
| |
| |
| |
Inventories |
| |
| |
| |
Other assets, current portion |
| |
| |
| |
Property and equipment, net |
| |
| |
| |
Operating lease right-of-use assets |
| |
| |
| |
Intangible assets, net |
| |
| |
| |
Goodwill |
| |
| |
| |
Deposits and other non-current assets | | |
| |
| |
Deferred tax assets |
| |
| |
| |
Net trade accounts and notes receivable, non-current |
| |
| — |
| |
Total current assets | | | | | | |
Non-current assets | | | | — | | |
Total assets of discontinued operations | | |
| |
| |
LIABILITIES | | | | | | |
Trade accounts and notes payable |
| |
| |
| |
Deferred revenues, current portion |
| |
| |
| |
Social security and other payroll withholdings taxes | | |
| |
| |
Employee absences compensation | | |
| |
| |
Income taxes payable | | |
| |
| |
Other accrued liabilities |
| |
| |
| |
Short-term borrowings |
| |
| |
| |
Current obligations under finance leases |
| |
| |
| |
Current portion of operating lease obligations |
| |
| |
| |
Current portion of long-term debt |
| |
| — |
| |
Deferred revenues, non-current |
| |
| |
| |
Obligations under finance leases |
| |
| |
| |
Operating lease obligations, non-current |
| |
| |
| |
Long-term debt, non-current |
| |
| — |
| — |
Other long-term liabilities |
| |
| |
| |
Total current liabilities | | | | | | |
Total non-current liabilities | | | | — | | |
Total liabilities of discontinued operations | | |
| |
| |
24
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
Allocations, Interest and Continuing Involvement
Amounts reported in discontinued operations include the revenues and costs directly attributable to the ESWL and Distribution segments. General corporate overhead not directly attributable to the discontinued businesses continues to be reported in continuing operations. Except for short-term borrowings related mainly to factored receivables in Japan, the Company does not expect any purchaser to assume Company indebtedness in connection with the planned disposals, and accordingly
EIB Credit Facility
The Company’s Finance Contract with EIB contains provisions applicable to disposals of assets or businesses, including requirements to inform EIB of contemplated disposals and, in certain circumstances, to apply disposal proceeds toward prepayment of amounts outstanding under the Credit Facility. The Company has informed EIB of the planned exit of the ESWL and Distribution businesses, and these provisions do not restrict the Company’s ability to transfer the businesses in their present condition. The Company will assess any required application of sale proceeds, and the related classification of borrowings under the Credit Facility, upon execution of definitive transaction agreements. See Note 6, Long Term Debt.
Cash Flow Information
The Company has elected not to separately present the operating and investing cash flows of discontinued operations in the condensed consolidated statements of cash flows. Depreciation, amortization, capital expenditures and significant operating and investing noncash items of the discontinued operations for the nine months ended September 30, 2026 and 2025 were as follows:
| | | | | | |
| | | | Nine Months Ended September 30, | ||
| | | | 2026 | | 2025 |
Depreciation and amortization | | |
| |
| |
Capital expenditures | | |
| |
| |
Non cash - Financing lease obligations incurred | | |
| |
| |
Non cash Operating lease obligations incurred | | | | |
| |
NOTE 19. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest and income taxes paid were as follows:
| | | | |
| | Nine Months Ended September 30, | ||
| | 2026 | | 2025 |
Income taxes paid |
| |
| |
Interest paid |
| |
| |
Interest received |
| |
| |
Unpaid capital increase issuance cost | | | | — |
Income taxes paid during the nine months ended September 30, 2026, primarily relate to discontinued operations.
25
EDAP TMS S.A. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(in thousands of U.S. dollars)
(unaudited)
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with the unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q (this “Quarterly Report”) and our Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 25, 2026 (the “2025 Annual Report”). The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in these forward-looking statements. See the section of this Quarterly Report titled “Cautionary Statement on Forward-Looking Information.”
Overview
On May 28, 2026, our Board of Directors approved a plan to exit our ESWL and Distribution segments, and on May 29, 2026 we announced our rebrand to FocalTherics and our strategic realignment to focus exclusively on our robotic focal therapy business built around the Focal One® HIFU platform. At the end of the second quarter of 2026, the ESWL and Distribution segments met the criteria to be reported as discontinued operations, and their results are excluded from continuing operations for all periods presented in this Quarterly Report. Prior to this classification, the ESWL and Distribution businesses represented a significant portion of our consolidated results, including approximately 47% of our consolidated revenue for the year ended December 31, 2025. We expect to complete the disposals through one or more transactions within one year of the held-for-sale classification, and until completion the timing, structure and terms of any transaction remain subject to negotiation and execution risk. Unless otherwise indicated, the discussion below relates to our continuing operations, which consist of our HIFU business. See Note 18 to our unaudited condensed consolidated financial statements for additional information.
Results of Operations
The following table sets forth our net sales and profit (loss), for the three months ended September 30, 2026 and 2025, and for the nine months ended September 30, 2026 and 2025:
| | | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, | | ||||
(in millions of US dollars, except percentages) | | 2026 | | 2025 | | 2026 | | 2025 | |
Total revenues |
| 9.8 |
| 7.8 | | 34.6 |
| 23.8 | |
Total cost of sales |
| (4.8) |
| (4.2) | | (16.3) |
| (12.2) | |
Gross profit |
| 5.1 |
| 3.6 | | 18.4 |
| 11.7 | |
Gross profit as a percentage of total net sales |
| 51.41 | % | 46.59 | % | 53.01 | % | 48.94 | % |
Total operating expenses |
| (12.8) |
| (10.3) | | (42.2) |
| (31.7) | |
Loss from operations |
| (7.7) |
| (6.7) | | (23.8) |
| (20.0) | |
Net loss |
| (4.5) |
| (5.9) | | (28.0) |
| (19.8) | |
Three Months Ended September 30, 2026 Compared to Three Months Ended September 30, 2025
The total revenues increased by 25.5% from $7.8 million in the three months ended September 30, 2025 to $9.8 million in the three months ended September 30, 2026, reflecting growth of equipment sales and treatment-driven revenue.
The sales of medical devices increased 29.8% with $4.3 million in the three months ended September 30, 2026, with 7 Focal One units sold (including 2 in the United States), as compared to $3.3 million in the three months ended September 30, 2025, with 6 Focal One units sold (including 3 in the United States).
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Treatment-driven revenue, which includes sales of revenue-per-procedure (“RPP”) & leases, sales of disposables, and treatment-related services, increased by 24.3% to $4.8 million in the three months ended September 30, 2026, as compared to $3.9 million in the same period in 2025.
Cost of Sales and Gross Margin
Cost of sales increased 14.2%, from $4.2 million in the three months ended September 30, 2025 to $4.8 million in the three months ended September 30, 2026, and represented 48.6% of net sales in the three months ended September 30, 2026, down from 53.4% of net sales in the three months ended September 30, 2025. Gross margin increased to 51.4% during the three months ended September 30, 2026, compared to 46.6% for the three months ended September 30, 2025. The increase in gross margin was primarily attributable to improvement on standard cost of the Focal One and favorable absorption of our fixed costs due to higher production volumes.
Operating Expenses
Operating expenses increased 24.4%, or $2.5 million, from $10.3 million in the three months ended September 30, 2025 to $12.8 million in the three months ended September 30, 2026.
Marketing and sales expenses were $5.9 million in the three months ended September 30, 2026, compared to $4.2 million in the three months ended September 30, 2025.
Research and development (“R&D”) expenses increased 6.9%, or $0.2 million, from $2.3 million in the three months ended September 30, 2025 to $2.5 million in the three months ended September 30, 2026.
General and administrative expenses increased $0.6 million, or 16.3%, from $3.8 million in the three months ended September 30, 2025 to $4.5 million in the three months ended September 30, 2026, primarily driven by an increase in fees related to our transition to domestic filer status.
Financial (Expense) Income, Net
Net financial income was $2,038 thousand in the three months ended September 30, 2026, compared to net financial expense of $60 thousand in the three months ended September 30, 2025.
Net financial income was primarily driven by the gain on the variation of the fair value of the warrants we issued to European Investment Bank (“EIB”) of $2.6 million, partially offset by the interest expense of the EIB loan of $0.7 million in the three months ended September 30, 2026.
Foreign Currency Exchange Gain (Loss), Net
In the three months ended September 30, 2026, we recorded a net foreign currency exchange gain of $467 thousand, mainly due to the variation of the Japanese Yen and the U.S dollar against the Euro, compared to a net gain of $85 thousand in the three months ended September 30, 2025.
Income Taxes
Income tax expenses in the consolidated statement of operations remained relatively flat at $15 thousand in the three months ended September 30, 2026, compared to $16 thousand in the three months ended September 30, 2025.
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Profit (loss) from discontinued operations, net of tax
Net profit from discontinued operations was $825 thousand in the three months ended September 30, 2026, compared to $721 thousand in the three months ended September 30, 2025.
Net Loss
As a result of the above, we recorded a consolidated net loss of $4.5 million in the three months ended September 30, 2026, compared with a consolidated net loss of $5.9 million in the three months ended September 30, 2025.
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025
The total revenues increased by 45.2% from $23.8 million in the nine months ended September 30, 2025 to $34.6 million in the nine months ended September 30, 2026, reflecting growth of equipment sales and treatment-driven revenue.
The sales of medical devices increased 70.6% with $18.2 million in the nine months ended September 30, 2026, with 31 Focal One units sold (including 15 in the United States), as compared to $10.7 million in the nine months ended September 30, 2025, with 21 Focal One units sold (including 10 in the United States).
Treatment-driven revenue increased by 30.7% to $14.3 million in the nine months ended September 30, 2026, as compared to $11.0 million in the same period in 2025.
Cost of Sales and Gross Margin
Cost of sales increased 33.7%, from $12.2 million in the nine months ended September 30, 2025 to $16.3 million in the nine months ended September 30, 2026, and represented 47.0% of net sales in the nine months ended September 30, 2026, down from 51.1% of net sales in the nine months ended September 30, 2025. Gross margin increased to 53.0% during the nine months ended September 30, 2026, compared to 48.9% for the nine months ended September 30, 2025. The increase in gross margin was primarily attributable to focused effort on components cost reduction on standard cost of the Focal One and favorable absorption of our fixed costs due to higher production volumes for system and consumables.
Operating Expenses
Operating expenses increased 33.0%, or $10.5 million, from $31.7 million in the nine months ended September 30, 2025 to $42.2 million in the nine months ended September 30, 2026.
Marketing and sales expenses were $19.7 million in the nine months ended September 30, 2026, compared to $13.9 million in the nine months ended September 30, 2025.
R&D expenses increased 4.2% to $7.2 million in the nine months ended September 30, 2026 compared to $7.0 million the nine months ended September 30, 2025.
General and administrative expenses increased $4.3 million, or 39.7%, from $10.9 million in the nine months ended September 30, 2025 to $15.2 million in the nine months ended September 30, 2026, primarily driven by an increase in fees related to our transition to domestic filer status.
Financial (Expense) Income, Net
Net financial expense was $6.0 million in the nine months ended September 30, 2026, compared to net financial expense of $142 thousand in the nine months ended September 30, 2025.
The financial expense was primarily driven by the variation of the fair value of the warrants we issued to EIB of $4.3 million and the interest expense of the EIB loan of $1.8 million in the nine months ended September 30, 2026.
28
Foreign Currency Exchange Gain (Loss), Net
In the nine months ended September 30, 2026, we recorded a net foreign currency exchange gain of $544 thousand, mainly due to the variation of the U.S dollar and the Japanese Yen against the Euro, compared to a net loss of $579 thousand in the nine months ended September 30, 2025.
Income Taxes
Income tax expenses in the consolidated statement of operations remained relatively flat at $40 thousand in the nine months ended September 30, 2026, compared to $39 thousand in the nine months ended September 30, 2025.
Profit (loss) from discontinued operations, net of tax
Net profit from discontinued operations was $1,263 thousand in the nine months ended September 30, 2026, compared to $1,006 thousand in the nine months ended September 30, 2025.
Net Loss
As a result of the above, we recorded a consolidated net loss of $28.0 million in the nine months ended September 30, 2026, compared with a consolidated net loss of $19.8 million in the nine months ended September 30, 2025.
Effects of Inflation
In 2026 and 2025, geopolitical instability and other factors have continued to contribute to worldwide inflation, leading to a global increase in costs. We are constantly addressing this cost increase by mitigating the impact on our margins, in particular by adjusting our prices, reducing our costs, and implementing countermeasures to ensure the minimum residual impact.
Liquidity and Capital Resources
Our primary sources of capital have historically been proceeds from our public and private securities offerings and issuances of debt.
Our primary short-term needs for capital for our planned operations, which are subject to change, include:
We have a history of operating losses and expect such losses to continue in the foreseeable future. As of September 30, 2026, we had $56.3 million cash and equivalent, an increase of $35.8 million from December 31, 2025, primarily reflecting net proceeds of approximately $43.1 million from our August 2026 underwritten offering and $14.0 million of net proceeds from drawing of Tranche B of our credit facility (the “Credit Facility”) established pursuant to that certain finance contract (the “Finance Contract”), dated October 17, 2025, with European Investment Bank (“EIB”).
In August 2026, the Company completed an underwritten offering of American Depositary Shares (“ADSs”) where it sold an aggregate of 9,688,750 ADSs for net proceeds of approximately $42.4 million, following deduction of underwriting discounts and commissions and estimated offering expenses.
We believe we have sufficient funds to support our operations for at least a period of twelve months from the date of issue of these interim condensed consolidated financial statements.
Although the additional capital provides us with increased liquidity and is expected to support our operations beyond the next twelve months, we continue to expect operating losses for the foreseeable future. Our ability to achieve profitability and generate positive cash flow from operations will depend on, among other things, the continued growth of our HIFU business, the successful commercialization and adoption of our products, the timing and level of our revenues, and our ability to manage operating
29
expenses and other cash requirements. If we are unable to achieve profitability and positive cash flow from operations within the period supported by our existing liquidity, or if our capital requirements are greater than currently anticipated, we may require additional financing in the future. The timing, terms and availability of any future financing will depend on a number of factors, including our operating performance, market conditions and our financial position at the time.
Cash Flows
The following table sets forth the primary sources and uses of cash for the periods presented below:
| | | | |
| | Nine Months Ended September 30, | ||
(in thousands of U.S. dollars) | | 2026 | | 2025 |
Net cash generated by/(used in) operating activities |
| (10,687) |
| (13,955) |
Net cash generated by/(used in) investing activities |
| (3,362) |
| (4,002) |
Net cash generated by/(used in) financing activities |
| 50,707 |
| (2,847) |
Net effect of exchange rate changes on cash and cash equivalents |
| (842) |
| 2,217 |
Net increase/(decrease) in cash and cash equivalents |
| 35,817 |
| (18,588) |
Cash and cash equivalents at the beginning of the year |
| 20,452 |
| 30,995 |
Cash and cash equivalents at the end of period |
| 56,269 |
| 12,407 |
Net Cash Used in Operating Activities
Net cash used in operating activities for the nine months ended September 30, 2026, was $10.7 million, consisting of net loss of $28.0 million offset by non-cash expenses of $12.6 million and positive changes in working capital of $4.9 million. These non-cash expenses primarily consisted of $2.9 million of depreciation and amortization, $2.4 million of stock-based compensation expense, and $6.0 million related to the change in the fair value of the EIB warrants and loan amortizations.
Net Cash Used in Investing Activities
Net cash used in investing activities for the nine months ended September 30, 2026, was $3.4 million, consisting primarily of investments of $2.4 million in capitalized assets and investment of $0.8 million in property and equipment.
Net Cash Generated by Financing Activities
Net cash generated by financing activities for the nine months ended September 30, 2026, was $50.7 million, consisting primarily of the net proceeds of $43.1 million from the underwritten offering, the net proceeds of $14.0 million from borrowings under the EIB credit facility, the repayment of long-term borrowings and financing leases of $2.0 million and reduction of short-term borrowings of $4.4 million.
Contractual Obligations and Commitments
Our contractual obligations and commitments are discussed in Note 6 – Long Term Debt.
Critical Accounting Policies
Our significant accounting policies are discussed in Note 1, Notes to the Condensed Consolidated Financial Statements (Unaudited) and Note 2, Summary of significant accounting policies, of the notes to the unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report.
Critical Accounting Estimates
Management has identified estimates made in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations of the registrant.
30
Identified accounting estimates are as follows:
| 1- | Discontinued operations and assets held for sale |
The classification and measurement of the ESWL and Distribution disposal groups as discontinued operations and assets held for sale requires significant judgment. Management evaluates whether the planned disposal represents a component or group of components, whether the held-for-sale criteria are met, and whether the disposal represents a strategic shift that has, or will have, a major effect on the Company’s operations and financial results. Upon classification as held for sale, the disposal groups are measured at the lower of carrying amount and fair value less costs to sell. The determination of fair value less costs to sell requires management to use estimates and assumptions, including expected transaction perimeter, expected buyer interest, market-based pricing indications, projected cash flows, discount rates, and expected costs to sell. Changes in these assumptions could result in a material impairment charge or adjustment to the carrying amount of the disposal groups.
| 2- | Fair value of warrant liability |
The Company measures certain warrants at fair value, with changes in fair value recognized in earnings. The fair value measurement requires judgment in selecting an appropriate valuation model and assumptions, including expected volatility, expected term, risk-free interest rate, share price, exercise price and expected dividends. Although certain inputs may be observable, changes in the Company’s share price, volatility assumptions or expected term could materially affect the fair value of the warrant liability and the resulting non-cash gain or loss recognized in the statement of operations.
Off-Balance Sheet Arrangements
As of September 30, 2026, we had no off-balance sheet arrangements.
New Accounting Standards Not Yet Adopted
See Note 2, Summary of Significant Accounting Policies, to our unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report for more information.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
Not applicable. We are a “smaller reporting company,” as defined by Rule 12b-2 under the Exchange Act of 1934, as amended (the “Exchange Act”), and in Item 10(f)(1) of Regulation S-K, and are not required to provide the information under this item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer, Ryan Rhodes, and Chief Financial Officer, Ken Mobeck, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2026. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2026.
Disclosure controls and procedures means controls and other procedures that are designed to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosures. The Company’s disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of its disclosure control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.
31
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
32
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
From time to time, we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. We are not party to any material legal proceedings, and no such proceedings are, to management’s knowledge, threatened against us.
Item 1A. Risk Factors
As of the date of this Quarterly Report, there have been no material changes to the risk factors previously disclosed in Part I, Item 1A of our 2025 Annual Report other than the additional risk factor included below. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.
Our plan to discontinue our ESWL and Distribution operating segments may materially and adversely affect our business, financial condition, operating results and prospects or cause revenue disruption.
While our plan to discontinue our ESWL and Distribution operating segments and report and classify them as discontinued operations in our financial statements aligns with our long-term strategic goals, it carries inherent risks, including:
| ● | that the discontinuation may take longer or cost more than expected, may result in disputes with customers, distributors, employees or other counterparties, and may not produce the strategic benefits anticipated; |
| ● | a potential reduction in our global near-term revenue as we scale back our distribution activities; |
| ● | a possible decline in stock price, particularly if investors perceive the shift as a risk to short-term revenues, if investors do not agree with the strategic change, or if the transition does not proceed as smoothly as anticipated; and |
| ● | strained relationships with investors and stakeholders who may be concerned about the potential negative financial and reputational impact of this strategic change, including the potential loss of revenue streams from the discontinuance of our ESWL and Distribution operating segments. |
The execution of this discontinuance may involve significant risks, even beyond those outlined above, that could materially and adversely affect our business, financial condition, operating results and prospects or cause revenue disruption.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
Not applicable.
Item 5. Other Information
Director and Officer Trading Arrangements
During the three months ended September 30, 2026, no director or officer of the Company
33
Item 6. Exhibits
The following exhibits are filed, furnished, or incorporated herein by reference as part of this Quarterly Report.
| | | | | | |||||||
Exhibit No. | | Description | | Form | | Exhibit | | Date Filed | | File No. | | Filed Herewith |
3.1 | | By-laws (statuts) of EDAP TMS S.A. (English translation) as amended as of September 2, 2026 | | | | 3.1 | | | | | | X |
4.1 | | Form of Amended and Restated Depositary Agreement between EDAP TMS S.A. and The Bank of New York Mellon, as depositary | | F-6 | | 1.2 | | 9/15/2011 | | 333-176843 | | |
4.2 | | Form of American Depositary Receipt (included in Exhibit 4.1) | | | | | | | | | | |
| | | | | | | | | | |||
31.1 | | Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | | | | | | X | ||||
31.2 | | Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | | | | | | X | ||||
32.1* | | Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | | | | | | X | ||||
101.INS | | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document | | | | | | X | ||||
101.SCH | | Inline XBRL Taxonomy Extension Schema Document | | | | | | X | ||||
101.CAL | | Inline XBRL Taxonomy Extension Calculation Linkbase Document | | | | | | X | ||||
101.DEF | | Inline XBRL Taxonomy Extension Definition Linkbase Document | | | | | | X | ||||
101.LAB | | Inline XBRL Taxonomy Extension Label Linkbase Document | | | | | | X | ||||
101.PRE | | Inline XBRL Taxonomy Extension Presentation Linkbase Document | | | | | | X | ||||
104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document) | | | | | | X |
† Indicates management contract or compensatory plan or arrangement.
* The certifications attached as Exhibits 32.1 is not deemed “filed” with the U.S. Securities and Exchange Commission is not incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report, irrespective of any general incorporation language contained in such filing.
34
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | EDAP TMS S.A. |
| | |
| | |
Dated: November 5, 2026 | | /s/ Ryan Rhodes |
| | Ryan Rhodes |
| | Chief Executive Officer |
| | |
| | |
Dated: November 5, 2026 | | /s/ Ken Mobeck |
| | Ken Mobeck |
| | Chief Financial Officer |
35